On the antlers of a dilemma: The ambitions of Ma Ying-jeou, Taiwan’s president, collide with popular suspicion of China

On the antlers of a dilemma: The ambitions of Ma Ying-jeou, Taiwan’s president, collide with popular suspicion of China

Mar 29th 2014 | From the print edition

THE fresh-faced good looks have been lined and drawn by the cares of office. His immaculate English is forsaken for the dignity of immaculate Mandarin. Patient replies to questions come wearily, as if said many times before. Yet, six years into his presidency, Ma Ying-jeou’s hair remains as lush and jet-black as any Chinese Politburo member’s. And, speaking in the presidential palace in Taipei, he remains as unwilling as any leader in Beijing to admit to any fundamental flaws in strategy.

Perhaps Mr Ma draws inspiration from his portrait of Sun Yat-sen, founder of his ruling party, the Kuomintang (KMT), and, in 1912, of the Republic of China to which Taiwan’s government still owes its name. Sun is revered as a nationalist hero not just by the KMT but, across the Taiwan Strait, by the Chinese Communist Party too. Mr Ma may also hope to be feted on both sides of the strait—in his case as a leader responsible for a historic rapprochement. For now, however, reconciliation between Taiwan and China remains distant. And Mr Ma, once the KMT’s most popular politician, is taunted by opponents as the “9% president”, a reference to his approval ratings in opinion polls last autumn.

Improving relations with China has been the central theme of his administration, after the tensions of eight years of rule by the Democratic Progressive Party (DPP), which leans towards declaring formal independence from the mainland. Mr Ma can boast of 21 agreements signed with China. He reels off the numbers of two fast-integrating economies: a tenfold increase in six years in mainland tourists to Taiwan, to 2.85m in 2013; cross-strait flights from none at all to 118 every day; two-way trade, including with Hong Kong, up to $160 billion a year.

China’s strategy to reabsorb Taiwan is plain. As the island’s economy becomes more intertwined with that of the vast mainland, China thinks, resistance to unification will wane. Then Taiwan becomes an “autonomous” part of China—like Hong Kong, though allowed its own army. Taiwan will return to the motherland without resort to the missiles and increasingly powerful armed forces ranged against it. But as Mr Ma sees it, cross-strait “rapprochement” is a first line of defence against Chinese aggression, since “a unilateral move by the mainland to change the status quo by non-peaceful means would come at a dear price”. Politics in Taiwan is framed as a debate about independence or unification but is really about preserving the status quo.

The next step in rapprochement with China would be a meeting between political leaders. In February in Nanjing, once the capital of a KMT government of all China, ministers from China and Taiwan held their first formal meeting since 1949. Mr Ma hoped to meet China’s president, Xi Jinping, in Beijing this November, at the Asia-Pacific Economic Co-operation (APEC) summit. To accommodate Hong Kong and Taiwan, APEC’s members are not “countries” but “economies”. So Mr Xi and Mr Ma could meet as “economic leaders”, sidestepping the tricky protocol that usually dogs relations, with China viewing Taiwan as a mere province. The Chinese demurred. But Mr Ma thinks a meeting somewhere is “not outside the realm of possibility”.

This backdrop explains why a protest movement against a services-trade agreement with the mainland is more than a little local difficulty for Mr Ma. Students occupying parliament have resorted to undemocratic means, and many of the arguments they and the DPP make about the trade agreement are specious. But they have tapped a vein of popular mistrust of Mr Ma and of economic integration with the mainland. A split persists between native Taiwanese, on the island for generations, and mainlanders, like Mr Ma, whose families came over as the KMT lost the civil war in the 1940s. Protesters portray Mr Ma as either a mainland stooge or as clueless and out of touch. In the occupied parliament, student caricatures give him antlers, a reference to a slip he once made when he appeared to suggest that the deer-antlers used in Chinese medicine were in fact hair from the animal’s ears.

Mr Ma says public opinion supports a “Ma-Xi” summit. Joseph Wu of the DPP, however, claims such a meeting would actually damage the KMT in the next presidential election, due in 2016; rather, he says, Mr Ma is trying to leave a personal legacy. The DPP’s lead in the polls alarms not just the Chinese government but also America, which could do without another flare-up in a dangerous region. The stronger China grows, the more Taiwan’s security depends on commitments from America. It switched diplomatic recognition to Beijing in 1979, but Congress then passed a law obliging it to help Taiwan defend itself.

All political lives end…

Mr Ma says relations with America are better than they have ever been at least since 1979 and perhaps before. Others are doubtful. In all the talk of America’s “pivot” to Asia, its promises to Taiwan are rarely mentioned. Many in Taiwan paid attention when John Mearsheimer, an American academic, suggested in the National Interest, a policy journal, that there is “a reasonable chance American policymakers will eventually conclude that it makes good strategic sense to abandon Taiwan and to allow China to coerce it into accepting unification.” For some, abandonment is a fact of life and unification a matter of time. “No one is on our side strategically, diplomatically, politically; we have to count on China’s goodwill,” an academic in Taipei argues.

Mr Ma has tried to steer what seems a sensible middle course between such defeatism and the adventurism of those in the DPP who would like to confront and challenge China. But he sounds weary with the effort, and Taiwan’s people seem weary of him. Their pragmatism and the DPP’s internecine strife may yet see them elect another KMT president in 2016. But if Mr Ma hoped to leave office with cross-strait relations stabilised, and with his own role as an historic peacemaker recognised on both sides and around the world, he seems likely to be disappointed.


About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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